Chris Lombardi puts defense and security under the spotlight, as he shares his takes on recent NATO and EU cooperation and provides insight into the company’s own long-term strategic partnerships in Europe.

Three trends are currently driving the global electricity sector: decarbonization, decentralization and differentiation. Utilities are making significant contributions to mitigate carbon emissions, while a technology revolution is …

For much of the Olympic Games, France was the leading EU medal winner. In another arena – important to millions globally – it is a leader in Europe. On 1 August, it became the first European country to introduce a new financial-transaction tax (FTT) on equity sales and high-frequency trading.

The FTT, often called a ‘Robin Hood tax’, is a tax on selected products traded by the financial sector, such as equities, bonds, foreign exchange and their derivatives. Where those countries where such a tax has been introduced (in South Korea, South Africa, India, Hong Kong, the UK and Brazil), the tax may have been tiny (ranging between 0.005% and 0.5%), but it has raised substantial amounts of revenue. The FTT discourages high-risk financial operations and makes the financial sector pay its fair share of taxes. This is sensible: a reckless casino culture in parts of the financial sector caused the financial crisis. It is also fair: our governments bailed out the banks but left taxpayers with debts of trillions.

An FTT could also generate billions in euros to help the poorest and most excluded both domestically and internationally. This too is fair: every family in the West is paying for the financial sector’s mistakes, but so too are communities in the developing world, thousands of miles from the financial powerhouses of Europe.

An analysis by Action for Global Health of 2011 Official Development Assistance (ODA) data produced by Organisation for Economic Co-operation and Development (OECD) shows that European governments have been cutting foreign aid. In 2011, the Netherlands, one of the development aid champions, reduced ODA by more than 5%. Belgium reduced its spending by more than 10% and Spain reduced its ODA by more than 30%. These are cutbacks prompted by the financial, economic and now debt crises.

As Europe reduces its overseas development assistance, it is lagging ever further behind its promises to meet the United Nations’ Millennium Development Goals by 2015 and the possibility to end AIDS in a generation becomes remoter.

In deciding how the revenues of the new FTT are deployed, the French government should remember that that the brunt of these crises have been carried by the poor and excluded, at home but also abroad. France’s President François Hollande appears to recognise this. He deserves praise not just for his strong leadership, but also for his pledge, made at an international AIDS conference in Washington in late July, to use some of the FTT revenue to fight global poverty and HIV/AIDS.

However, these commitments at the moment are only in his rhetorical and need to be translated into action.

And he should be more ambitious. The French FTT, which came into effect on 1 August and applies to purchases of shares in businesses with a market value of over €1 billion, is not ambitious enough to raise significant revenues: the 0.2% levy is expected to raise €500 million next year.

Hollande, a Socialist, has in fact merely introduced the equivalent of the UK’s stamp duty on shares – but at only 0.2% per share traded compared to the UK stamp duty of 0.5%, introduced by Margaret Thatcher, a Conservative.

As a minimum, Hollande should raise the FTT rate to at least 0.5% per transaction. Khalil Elouardighi from Coalition Plus, a French HIV/AIDS organisation that campaigned for an FTT in France, believes that François Hollande should also commit half of the new revenue to saving essential social services in France and the other half to global development challenges such as bringing an end to AIDS, and improving health and education.

This would set the example that others need to follow. At least nine other European countries have said they will introduce an FTT via the ‘enhanced co-operation’ procedure, possibly by this December. They include Europe’s biggest economies (accounting for 67% of Europe’s gross domestic product) with the notable exception of the UK. The tax of between 0.01%-0.1% would apply not just to shares, but to bond and derivative transactions and could raise as much as €34 billion.

But the real test of leadership for France will be to convince EU member states who oppose the FTT to support it. If other governments in Europe and around the world were to follow France’s example and introduce the FTT, in one year a global FTT could raise around €325bn – money that could be use to provide access to drinking water, life-saving treatment to people living with HIV, and free healthcare to millions.

So far, Hollande deserves a bronze medal. If he raises the levy, allocates significant part of the revenues to help the poorest and convince other countries like the UK to support an FTT he will deserve a gold medal.

Olga Golichenko is global health officer at the International HIV/AIDS Alliance, a member of Action for Global Health, a network of 15 organisations working in six European countries and in Brussels.

Anti-deceptor

The French banks are exempted from this tax as market makers like in the UK. So again, as in the UK, only the dim-witted pensioners, investors and peasants pay this tax, not the banks.

“The tax of between 0.01%-0.1% … could raise as much as €34 billion.” Surely pensioners will not need it.

Posted on 8/14/12 | 9:03 AM CET

Anti-deceptor

FTT is the most deceptive tax devised.

The French banks are exempted from this tax as market makers like in the UK. So again, as in the UK, only the dim-witted pensioners, investors and peasants pay this tax, not the banks.

“The tax of between 0.01%-0.1% … could raise as much as €34 billion.” Surely pensioners will not need it.

Posted on 8/14/12 | 9:03 AM CET

Anti-deceptor

FTT is the most deceptive tax devised.

The French banks are exempted from this tax as market makers like in the UK. So again, as in the UK, only the dim-witted pensioners, investors and peasants pay this tax, not the banks.

“The tax of between 0.01%-0.1% … could raise as much as €34 billion.” Surely pensioners will not need it.

Posted on 8/14/12 | 9:03 AM CET

Anti-deceptor

FTT is the most deceptive tax devised.

The French banks are exempted from this tax as market makers like in the UK. So again, as in the UK, only the dim-witted pensioners, investors and peasants pay this tax, not the banks.

“The tax of between 0.01%-0.1% … could raise as much as €34 billion.” Surely pensioners will not need it.

Posted on 8/14/12 | 9:03 AM CET

Olya

Ordinary people will not bear the cost of FTTs.

The FTT will be paid, first and foremost, by the principal buyers/sellers of financial assets. In fact 85% of the taxable trades are carried out by banks and other financial institutions, such as hedge funds, whose clients are often high-net-worth individuals. Ordinary people do not, by and large, trade assets such as bonds or derivatives. Most particularly the FTT will have an impact on High Frequency Trading (HFT) , which is regarded as a good outcome by many economists who believe HFT is disruptive and risky and should either be regulated against or considerably reduced in size.

The FTT would – by reducing the systemic risks associated with high-frequency trading – contribute to market stability and therefore improve pension value over the long-term and reduce future risk of such substantial losses to pension funds. FTT revenues would be invested in key public services, including health care, which pensioners depend on.

Posted on 8/16/12 | 8:36 AM CET

Olya

Ordinary people will not bear the cost of FTTs.

The FTT will be paid, first and foremost, by the principal buyers/sellers of financial assets. In fact 85% of the taxable trades are carried out by banks and other financial institutions, such as hedge funds, whose clients are often high-net-worth individuals. Ordinary people do not, by and large, trade assets such as bonds or derivatives. Most particularly the FTT will have an impact on High Frequency Trading (HFT) , which is regarded as a good outcome by many economists who believe HFT is disruptive and risky and should either be regulated against or considerably reduced in size.

The FTT would – by reducing the systemic risks associated with high-frequency trading – contribute to market stability and therefore improve pension value over the long-term and reduce future risk of such substantial losses to pension funds. FTT revenues would be invested in key public services, including health care, which pensioners depend on.

Posted on 8/16/12 | 8:36 AM CET

Olya

Ordinary people will not bear the cost of FTTs.

The FTT will be paid, first and foremost, by the principal buyers/sellers of financial assets. In fact 85% of the taxable trades are carried out by banks and other financial institutions, such as hedge funds, whose clients are often high-net-worth individuals. Ordinary people do not, by and large, trade assets such as bonds or derivatives. Most particularly the FTT will have an impact on High Frequency Trading (HFT) , which is regarded as a good outcome by many economists who believe HFT is disruptive and risky and should either be regulated against or considerably reduced in size.

The FTT would – by reducing the systemic risks associated with high-frequency trading – contribute to market stability and therefore improve pension value over the long-term and reduce future risk of such substantial losses to pension funds. FTT revenues would be invested in key public services, including health care, which pensioners depend on.

Posted on 8/16/12 | 8:36 AM CET

Olya

Ordinary people will not bear the cost of FTTs.

The FTT will be paid, first and foremost, by the principal buyers/sellers of financial assets. In fact 85% of the taxable trades are carried out by banks and other financial institutions, such as hedge funds, whose clients are often high-net-worth individuals. Ordinary people do not, by and large, trade assets such as bonds or derivatives. Most particularly the FTT will have an impact on High Frequency Trading (HFT) , which is regarded as a good outcome by many economists who believe HFT is disruptive and risky and should either be regulated against or considerably reduced in size.

The FTT would – by reducing the systemic risks associated with high-frequency trading – contribute to market stability and therefore improve pension value over the long-term and reduce future risk of such substantial losses to pension funds. FTT revenues would be invested in key public services, including health care, which pensioners depend on.

Posted on 8/16/12 | 8:36 AM CET

Alan

Purpose of the tax is to discourage a particular type of behaviour – but it will only raise revenue if that (undesirable) behaviour continues unaffected by the tax. Or drives the type of transaction being taxed off to another jurisdiction…

Posted on 8/16/12 | 12:25 PM CET

Alan

Purpose of the tax is to discourage a particular type of behaviour – but it will only raise revenue if that (undesirable) behaviour continues unaffected by the tax. Or drives the type of transaction being taxed off to another jurisdiction…

Posted on 8/16/12 | 12:25 PM CET

Alan

Purpose of the tax is to discourage a particular type of behaviour – but it will only raise revenue if that (undesirable) behaviour continues unaffected by the tax. Or drives the type of transaction being taxed off to another jurisdiction…

Posted on 8/16/12 | 12:25 PM CET

Alan

Purpose of the tax is to discourage a particular type of behaviour – but it will only raise revenue if that (undesirable) behaviour continues unaffected by the tax. Or drives the type of transaction being taxed off to another jurisdiction…

Posted on 8/16/12 | 12:25 PM CET

Nicolas Morice

Merci, Président Sarkozy !
France introduced the FTT as part of the Amending Finance Bill for 2012 dated 14 March 2012. At this date, the president of the french republic was Nicolas Sarkozy !

Posted on 8/17/12 | 7:39 AM CET

Nicolas Morice

Merci, Président Sarkozy !
France introduced the FTT as part of the Amending Finance Bill for 2012 dated 14 March 2012. At this date, the president of the french republic was Nicolas Sarkozy !

Posted on 8/17/12 | 7:39 AM CET

Nicolas Morice

Merci, Président Sarkozy !
France introduced the FTT as part of the Amending Finance Bill for 2012 dated 14 March 2012. At this date, the president of the french republic was Nicolas Sarkozy !

Posted on 8/17/12 | 7:39 AM CET

Nicolas Morice

Merci, Président Sarkozy !
France introduced the FTT as part of the Amending Finance Bill for 2012 dated 14 March 2012. At this date, the president of the french republic was Nicolas Sarkozy !